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FTSE Gains on Back of Weaker Pound

Thu, 23rd May 2019

Earnings updates were a key focal point yesterday as the UK’s top flight inched upwards, although the index remained constrained to recent ranges, as concerns over the outcome of the Brexit talks dominated the minds of investors.

The FTSE 100 ended the day up by 0.1 percent, at 7,683.97 points, reversing its earlier losses. Data showed that retail sales growth rose by less than had been expected in June, depressing the pound, and supporting shares in export-focused companies. Meanwhile, the FTSE 250 fell slightly, as the mid-cap index has a more domestic focus.

Unilever extended its gains, to top the FTSE 100 after the consumer-goods company reported that its profits had beaten expectations, with higher margins. The company missed its first half sales growth target, in part due to strikes in Brazil. Overall, though, the picture remained positive for the company.

There is no reason to think that the group will not be able to achieve its target of 20 percent by 2020. The focus is now on the company’s move out of London, which is something that shareholders will be voting on in October. Shares in the company fell sharply during early trade, but rebounded to end the day up by 3 percent, thanks in part to the weakness of the pound. SSE was another company that made losses, shedding 2.3 percent after the energy supplier reported that it had lost more customers during the first quarter of the year. WPP also made losses, in part due to a disappointing update from Publicis, a French industry peer.

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